Bitcoin Under Pressure as Macro Conditions Turn Hostile
Bitcoin's recovery from its June/July low is facing a new test as macroeconomic conditions become increasingly hostile. The asset has already taken a significant hit this year, falling from $97,867 in May to around $57,776 before rebounding.
The recovery has been driven by buyers stepping in despite elevated yields, oil prices above $100, and repeated risk-off episodes. However, the latest environment is less favorable, with the U.S. 10-year Treasury yield approaching 5% and the Fed raising rates by 25 basis points on September 16.
The dollar strengthened following the rate hike, while Treasury yields remained elevated. Brent oil prices have traded above $100 amid the ongoing Middle East conflict, potentially keeping inflation elevated and central banks restrictive for longer.
Regulatory uncertainty also weighs on Bitcoin, with the U.S. Senate failing to advance the CLARITY Act on September 15. Japan's monetary policy is another variable, with expectations of further Bank of Japan tightening affecting global funding conditions.